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24 Sep 2014
RBA financial stability report: Steps up talk on macro-prudential measures
FXStreet (Bali) - On its semi-annual financial stability report, the RBA said that additional measures might be considered to cool down housing prices and limit banks# lending practices.
As Reuters reports: "In a 64-page Financial Stability Review report, the RBA said the crucial question for macroeconomic and financial stability is whether lending practices are conservative enough for the current combination of low interest rates, strong house price growth and higher household indebtedness."
Key headlines (via Reuters)
Discussing with Apra further steps to strengthen bank lending standards
Apra has already intensified supervision of mortgage lending
Composition of housing and mortgage market becoming "unbalanced"
Bank competition driving strong rise in loans for housing investment
Speculative demand could amplify house price cycle, risk eventual sharp reversal
Risks from housing cycle mostly macroeconomic, could become systemic if loan growth persists
Important that australian banks do not loosen mortgage lending standards
Overall lending standards have not eased as yet, but still might not be conservative enough
Strong investor demand for commercial property driving up prices, but risks modest so far
Australian bank profitability remains robust, capital ratios rising and bad debts falling
Shadow banking only small fraction of australian market, poses little systemic risk
Indicators point to low levels of financial stress in household sector
Business lending by foreign-owned banks in australia expanding at a fast pace
Rising concerns about asset quality in china amid slower growth, softer house prices
As Reuters reports: "In a 64-page Financial Stability Review report, the RBA said the crucial question for macroeconomic and financial stability is whether lending practices are conservative enough for the current combination of low interest rates, strong house price growth and higher household indebtedness."
Key headlines (via Reuters)
Discussing with Apra further steps to strengthen bank lending standards
Apra has already intensified supervision of mortgage lending
Composition of housing and mortgage market becoming "unbalanced"
Bank competition driving strong rise in loans for housing investment
Speculative demand could amplify house price cycle, risk eventual sharp reversal
Risks from housing cycle mostly macroeconomic, could become systemic if loan growth persists
Important that australian banks do not loosen mortgage lending standards
Overall lending standards have not eased as yet, but still might not be conservative enough
Strong investor demand for commercial property driving up prices, but risks modest so far
Australian bank profitability remains robust, capital ratios rising and bad debts falling
Shadow banking only small fraction of australian market, poses little systemic risk
Indicators point to low levels of financial stress in household sector
Business lending by foreign-owned banks in australia expanding at a fast pace
Rising concerns about asset quality in china amid slower growth, softer house prices